WASHINGTON/HO CHI MINH CITY (yourNEWS) – In a significant development, the Biden administration has granted an indefinite waiver to two major South Korean technology firms, Samsung and SK Hynix Inc., allowing them to use U.S. semiconductor manufacturing equipment in their Chinese operations, as reported by Bloomberg.
This decision, effective Monday, permits these companies to use equipment safeguarded under U.S. intellectual property rights in their Chinese semiconductor ventures. The move comes after the Biden administration imposed restrictions on the semiconductor industry in October 2022. These restrictions would have hindered the import of U.S. technology if not for the waiver provided to these two South Korean companies.
Choi Sang-mok, an economic advisor to South Korea’s president, highlighted the significance of this decision, stating, “The U.S. government’s decision means that the biggest trade issue for Korean semiconductor companies has been resolved.” He emphasized the importance of stable production for Korean chip companies, which account for 60.5% of the world’s memory output, in ensuring the stability of the global semiconductor supply chain.
Initially, Samsung and SK Hynix Inc. had received a temporary waiver from the Biden administration following the October 2022 restrictions. However, uncertainty surrounding the future of these waivers led to a lack of investment in their Chinese operations, as per the Bloomberg report.
The U.S. and China are currently engaged in a trade war, with both nations striving to gain a technological edge in the chip industry. China has utilized its access to crucial raw materials, such as minerals necessary for semiconductor production, while the U.S. has leveraged its intellectual property advantage to hinder China’s technological progress.
In response to this development, a spokesperson from Samsung stated, “Through close coordination with relevant governments, uncertainties related to the operation of our semiconductor manufacturing lines in China have been significantly removed. We will continue to work closely with all relevant governments to maintain a stable supply chain for the global semiconductor industry.”
The October 2022 regulations in the chip industry also involved blacklisting several Chinese companies associated with the China semiconductor industry, preventing them from collaborating with U.S. companies to acquire U.S. technology. Additional restrictions were imposed in August, limiting U.S. private equity and venture capital firms from direct investments in companies linked to the semiconductor, quantum computing, and artificial intelligence sectors in China.
At the time of reporting, neither the U.S. Department of Commerce nor the involved South Korean companies, Samsung and SK Hynix, had provided immediate comments on this development.
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